We know how it is for the store owner out there - every few days a representative comes in touting that you should advertise in their magazine, newspaper, event, etc. We've been asked what is the biggest waste of money for our advertising dollars? How much should we be spending on advertising? Where? Here are a few (abridged) answers
How Much Should I Spend on Advertising?
A good rule of thumb is somewhere between 2% and 5% of your gross sales. If you are the first concept of your kind to your market, you should be closer to 5%. You'll need to explain your concept and start working on brand recognition. If you have been open for over a year, you can cut back a bit. If you have competitors in your market, you probably want to stick closer to 5% but will need to be very strategic with the advertising itself (keep reading).
Where Should I spend those dollars? Where Shouldn't I?
The biggest waste of advertising dollars is always money spent in the wrong place... Your marketing department or agency should work with you to pinpoint the best avenue for your message. For example, you may get a bigger return on multiple annual local school advertising opportunites vs. a short advertising run in a large newspaper that has a giant circulation. On the flip side, you may get a bigger return on spending almost all of your annual budget on a billboard that runs for six months. Though social media is cheap and easy, it may not be effective if you don't have an adequate number of existing fans to give your ads or promoted posts momentum. Have you considered local events like 5Ks or fundraisers? You might be able to do a small sponsorship and put a coupon in every runner's goody bag, but make sure there are enough runners for that sponsorship to be worthwhile. Also, check out the list of other vendors, since your coupon will be right next to their coupon in that bag!
...Or money spent on the wrong message. The messages you put into the market should change from the time you open to your first anniversary in the market, second year in the market, etc. If you are a store entering a market with multiple competitors, your message needs to be different than that of a first-to-market store. Advertising your product in a generic way may just make a viewer think of their favorite local burger or taco joint - not think 'man I should try the new taco place'! Don't let your ad money work for your competitors, try and think it through from a consumer's perspective.
Gather as much data as you can from the representives of publications in your area. They should be able to tell you statistics that will help you make a more educated decision. Ask other local shop owners about their experiences, contact your corporate office, or a find marketing partner for help navigating the waters, don't go it alone!